Information System Summary

We began with an examination of accounting as an information system consisting of three activities-input, processing and output. The systems characteristic of accounting suggests that the systems approach is the ideal way of studying the subject. It is not sufficient, however, to view accounting purely as an operating system, for its relevance and usefulness may only be judged by the degree with which its output meets the needs of the users of accounting information. By identifying the basic goal of an accounting information system as being the provision of information for decision making, we provide a framework by which to judge the effectiveness of that system.

There are many approaches to the study of decision making-economic, behavioural and quantitative, and the inter-disciplinary nature of decision theory has the inevitable consequence that accounting has also become an inter-disciplinary subject. The systems approach facilitates an interdisciplinary study of accounting because it requires that it be viewed, not in isolation, but as one element in a broad informational context.

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Read on: A Systems Approach to the Study of Accounting

A systems approach to the study of accounting

The study of the firm as an organization consisting of several systems, for example, an operating system, a financial system, a personnel system and a marketing system, enables one to see the accounting system as one element of an interacting whole. This manner of seeing the nature of the various elements of an organization is known as the systems approach.

The accounting system is the most important element of an organization's information system, for the following reasons:

(1) The accounting information system is the... see: A Systems Approach to the Study of Accounting